Tax Deductible Charitable Donations

Charitable DonationsNow that the year end and all its celebrations and busyness has passed, it is time to prepare for the 2015 tax filing season. If you took advantage of the opportunity to donate to charitable organizations during the big push by various organizations at the end of last year, or even throughout the past year, you may be due for a tax deduction for your generosity. That’s right, some or all of your financial donations may qualify as tax deductions.

You May Profit From Your Gift

Can your financial gifts actually give money back to you in return? It may not seem plausible that one would be able to profit from giving a financial donation, but it is totally legal and a legitimate deduction with the Internal Revenue Service (IRS). When you make a contribution to a non-profit organization, your gift may qualify as a deduction on your year end tax return. But first, you’ll want to be sure your donations properly qualify.

Does Your Gift Qualify As A Charitable Contribution?

If you are planning on giving a contribution with the intention that you will write it off as a tax deduction, we recommend that you do a bit of research beforehand to be sure that the organization is an official non profit. Keep in mind that there are for-profit organizations that also ask for donations, and any contributions you make to for-profits do not qualify with the IRS as charitable contributions, and therefore, are not tax deductible. Once you have made a charitable donation, you should receive a receipt from the non profit organization with the indication that the organization is a Section 501(c)3 nonprofit and that your gift may qualify as a charitable deduction for federal income tax purposes. Of course, you’ll want to consult with your tax advisor with any questions relating to the qualifications of your gift.

Types Of Non Profit Organizations

Here are a few of the typical non profit organizations you can contribute to that the IRS considers tax deductible:

  • Salvation Army
  • Goodwill Industries
  • Federal, state, and local government businesses
  • Public schools
  • Religious organizations
  • Non profit food banks and homeless shelters
  • Non profit hospitals
  • Veterans organizations

Gifts That Are Not Tax Deductible

While there are many organizations soliciting donations that are honorable, you should be aware that not all of these are non profit associations, so your donations would not be considered tax deductible. Here are a few examples of types of for profit organizations, contributions to these types of organizations will not qualify as deductible by the IRS:

  • Sports groups
  • Labor unions
  • Candidates running for political office
  • Political groups
  • Civic leagues

How To Stay On Top Of The 2015 IRS Changes

There are many details relating to the various IRS tax qualifications that can change year to year, but don’t worry about understanding all of them. Entrust your tax preparation this year with your tax preparer at E&Y Tax Preparation Service. Our friendly and professional tax preparers in Troy, MI are here to provide you with affordable and efficient tax return preparation, year after year. Call us at (248) 362-1313 for a free consultation.


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